The Journal of Sociology & Social Welfare
Volume 34
Issue 2 June
Article 12
2007
Globalization, Welfare Reform and the Social
Economy: Developing an Alternative Approach to
Analyzing Social Welfare Systems in the PostIndustrial Era
Gonzales
Follow this and additional works at: http://scholarworks.wmich.edu/jssw
Part of the Social Policy Commons, Social Welfare Commons, and the Social Work Commons
Recommended Citation
Gonzales (2007) "Globalization, Welfare Reform and the Social Economy: Developing an Alternative Approach to Analyzing Social
Welfare Systems in the Post-Industrial Era," The Journal of Sociology & Social Welfare: Vol. 34: Iss. 2, Article 12.
Available at: http://scholarworks.wmich.edu/jssw/vol34/iss2/12
This Article is brought to you for free and open access by the Social Work at
ScholarWorks at WMU. For more information, please contact
[email protected].
Globalization, Welfare Reform and the
Social Economy: Developing an
Alternative Approach to Analyzing
Social Welfare Systems in the
Post-Industrial Era
VANNA GONZALES
Arizona State University
School of Justice and Social Inquiry
Our understanding of the relationship between globalization and
contemporarysocial welfare systems is heavily influenced by three
conventional approaches to studying welfare reform: the political
economy, moral economy, and mixed economy approaches.In addition to analyzing the strengths and weaknesses of each of these approaches,a centralaim of this articleis to introducethe social economy approachas an emergent alternative.Drawingfrom a growing
body of work on institutionalinnovation within the Europeanthird
sector, I argue that the social economy approach makes a valuable
contributionto understandingthe role of welfare networks in reconfiguringglobalizations'impact on the characterand quality ofsocial
provision so as to better reconcile social efficacy with social justice.
Keywords: Globalization, Welfare Reform, Welfare Networks, the
Third Sector, Social Enterprises, Social Inclusion, Social Justice
Increasing market integration, changing demographics,
and shrinking public budgets have fueled a pervasive redefinition of the state's role in providing for the social welfare of
citizens. In addition to challenging public administration's
dominance over the production and distribution of social services, policy makers and politicians from across the political
Journal of Sociology & Social Welfare, June 2007, Volume XXXIV, Number 2
187
188
Journal of Sociology & Social Welfare
spectrum have called into question the once pervasive belief
that the state is exclusively entitled to guarantee the collective
well being of its citizenry. Together, these developments have
produced a climate favorable to the expanding role of the third
sector, not only in the delivery of social services, but in the formulation and stipulation of social welfare policy as well.'
Despite third sector organizations' increasing centrality in
the development of contemporary social welfare systems, the
two dominant approaches to studying welfare reform have
downplayed, if not ignored, their importance as an interface
between globalization and social wellbeing. Locked into a
dichotomous state-society framework, the political economy
and moral economy approaches have had a polarizing effect
on the way we understand globalization and its consequences
for welfare. Whereas the former adopts the 'welfare state' as its
central analytic unit and focuses on the degree to which globalization is undermining states' capacity to protect their citizens
social rights, the latter concentrates on the societal dynamics
of the 'welfare society', underscoring the key role of societal
actors in responding to societal need and the extent to which
the state has become the chief impediment to achieving social
justice. As a result of this dualism, the salience of the third
sector for transforming the structural and cultural foundation
of social welfare systems, and thus its capacity to mediate the
effects of globalization, has not been fully appreciated.
The so-called mixed economy approach emerged more recently to underscore the inherent pluralism of social welfare
systems and the role of the third sector as a vital intermediary between state, society and economy (Anheier and Seibel,
1990; Gidron, Kramer, Salamon, 1992; Salamon & Anheier,
1996; Salamon, 2002). Stemming primarily from professionals and practioners involved in the implementation and delivery of social and human services, this approach illuminates
the black box that separates policy formation from societal
outcomes by underscoring the productivist underpinnings of
the social welfare systems. Although it has made significant
advances in connecting the micro-level institutional dynamics involved in service provision to broader economic and
socio-political processes underlying contemporary welfare
reform, in focusing somewhat narrowly on the organization
Social Welfare Systems in the Post-IndustrialEra
189
and management of welfare production, it fails to explore the
broader structural implications of welfare reform and does not
take sufficient account of the social consequences that emerging welfare mixes have on both users and citizens more broadly
defined.
Given the shortcomings of these conventional approaches
to welfare reform, there is a particular need to identify and
develop new approaches to understanding the capacity of contemporary social welfare systems to meet the formidable challenges posed by globalization. A central aim of this paper is to
introduce such an approach. Based on a detailed analysis of the
strengths and weakness of the three conventional approaches
mentioned above, I establish the foundation for what I identify as a social economy approach to welfare. Drawing from a
growing body of work on institutional innovation within the
European third sector, I argue that this emergent alternative
makes a valuable contribution to understanding the role of
welfare networks in reconfiguring globalizations' impact on
the character and quality of social provision so as to better reconcile social efficacy with social justice.
Conventional Approaches to Analyzing the
Development of Contemporary
Social Welfare Systems
Each of the three conventional approaches to studying the
development of contemporary social welfare systems-the political economy approach, the moral economy approach and the
mixed economic approach-is based on a distinctive analytical
model, each with its own conceptual frameworks, theoretical
preferences, and normative commitments (See Table 1 below).
While each approach has contributed significantly to our understanding of how and why social welfare systems develop,
disciplinary boundaries and distinctive research agendas have
tended to thwart cross fertilization among them. Thus, looking
more closely at how they compare to one another is important
not only for identifying the social economy perspective as an
emergent alternative, but also for generating a more integrated, informed understanding of the impact of globalization on
social development in the twenty-first century.
Journal of Sociology & Social Welfare
Table 1: Contemporary Approaches to Analyzing the Development
of Contemporary Social Welfare Systems
Social Economy
Political
Economy
Moral
Economy
Mixed
Economy
Welfare State
Welfare
Society
Welfare Mix
Dominant
Theoretical
Frameworks
Historical
Institutionalism,
Neo-Marxism
Communitarianism,
Pluralism
Intitutional
Economics,
Non-Profit
Management
Cultural
Institutionalism,
Constructivism
Commitments
Economic Justice
EcmDistributional
Equity
Social
Cohesion,
Community
Development
Economic
Efficiency,
Organizational
Effectiveness
Social Justice,
Social Inclusion
Primary Unit
Nation-state,
Civil Socie
of Analysis
Social Policy
Nation-state,
Human Service
Organizations
Social Service
Systems,
Social Groups
Central
Analytical
Concept
ty,
Communities
Welfare
Network
The Political Economy Approach
Emerging during a period of profound faith in the state
as the key to prosperity and progress, the political economy
approach reflects the social ideals of the post-war era: universalism, equality, and the power of the state to provide an unprecedented quality of life for its citizens. The welfare state, its
key unit of analysis, is conceptualized as a form of embedded
liberalism-a reformist compromise capable of compensating
for, if not correcting, the most deleterious affects of the capitalist economy.
Although initially focused on the political engineering of
social protection vis-A-vis social rights and regulations, with
the end of the so-called Golden Age of the welfare state, the
political economy approach has focused on questions and
issues pertaining to welfare retrenchment and the respective role of politics and economics in driving welfare reform.
Although long a concern within liberal welfare states like the
United States, more recent debates about an emerging global
"third way" (Giddens, 2001) and the transformation of "vice
into virtue" among conservative, christian democratic welfare
states (Levy, 1999; Hemerijck and Visser, 2001) have drawn
Social Welfare Systems in the Post-IndustrialEra
191
attention to the ways in which welfare states are 'recalibrating'
(Ferrera and Hemerijck, 2003; Handler, 2003; Gilbert, 2002) and
the relevant degree of freedom they have in dealing effectively
with the cultural and economic challenges of globalization.
Within the political economy framework, the key point
of contention focuses on the extent to which there has been
greater convergence or persistent divergence among historically distinctive models of welfare state development. The
convergence thesis holds that welfare states, particularly those
characterized by comprehensive, national social programs
and public services, face growing external constraints to their
ability to maintain generous, publicly financed social protections. According to this thesis, shifting patterns in international trade and finance increase competitive pressures within the
global economy, thus restricting government's maneuverability
in crafting policy to meet domestic social and economic objectives (Castells, 1996; Kurzer, 1993; Gilbert, 2002). As traditional
macro-economic policy tools become harder to manage and
labor and total production costs rise due to the diversification
of demand and the increasing use of technology, governments
must rely heavily on non-payroll taxes to finance welfare expenditures. Yet high rates of inflation combined with shrinking
tax bases make substantial tax increases both economically and
politically unpopular. Combined with significant pressures to
reduce budget deficits, this situation places critical limits to
the expansion of social spending and thus the ability and willingness of governments to provide wide-ranging, long term
public benefits (Atkinson, 1992; Rhodes, 1995). In addition to
scaling back cash-based subsidies and increasing eligibility requirements, devolving competencies to lower levels of government and off-loading services to private providers are seen as
the logical product of welfare states' increasing vulnerability
to the vagaries of market forces (Bennet, 1994; Mangen, 1996;
Gilbert, 2002).
The divergence thesis, by contrast, is advanced by those
who see the link between economic imperatives and policy
choices as over determined. From this perspective, political
preferences, policy legacies, and institutional arrangements
are conditioned by historically driven, path-dependent processes which mitigate if not compel differential responses
Journal of Sociology & Social Welfare
192
to common challenges (Weir, Orloff, Skocpol, 1988; EspingAndersen, 1996; Ferrera, 1996; Pierson, 1997; Stephens and
Huber, 1998; Hacker, 2002; Swank, 2002). Because powerful
structural, political and cultural forces are seen as mediating
both policy makers perception of the challenges arising from
globalization as well as their responses to them, different types
of welfare states are seen as posing unique constraints and opportunities for reform. And because social reform reflects tensions generated by existing socio-political cleavages, cultural
values, and strategic maneuvering by relevant political actors,
the divergence thesis expects that reform will reflect the adoption of a wide range of policy tools. Thus, while decentralization and privatization may be standard policy proposals across
a variety of welfare states, the specific policies formulated and
implemented will vary. Thus, whereas the introduction of new
technology systems aimed at maximizing choice and increasing economic efficiency is expected in Liberal welfare states
like the United States and Great Britain, it is less likely in continental European countries where the legacies of familialism
and paternalism are stronger and budget control is a higher
priority.
While the political economy approach to welfare reform
offers an important contribution to our understanding of the
constraints and opportunities facing governments as they
attempt to craft solutions to the challenges raised by globalization, one of its key drawbacks is that by emphasizing convergence vs. divergence, it is of limited utility in helping us
to better understand the more nuanced dynamics of welfare
reform. While the state is imbued with responsibility and
control over welfare, society is seen primarily as the passive
recipient of state-generated policies and prescriptions. Thus,
arguments about the positive or negative effect of reforms on
social welfare tend to be based almost exclusively on their implications for the state. Either they are increasing the state's capacity to effectively and fairly respond to social needs (OECD
1996; Vandenbrouchke, 1998) or undermining its efforts to
maintain its commitments to reasonable, equitable and/or just
social benefits (Giamo, 1995; Gough, 1996; Fargion, 1998).
A second, yet related problem with the political economy
approach is that in focusing on the nation-state as its primary,
Social Welfare Systems in the Post-IndustrialEra
193
and in most cases exclusive, level of analysis, the space
between policy making and policy outcomes remains a black
box. In confining the analysis of globalization and its subsequent affects on welfare reform to "high politics," understood
as elite-level policy formation, the political economy approach underestimates or leaves out important dynamics that
operate in the realm of "low politics," as well as a variety of
cross cutting territorial and sector-based considerations that
profoundly impact the inter-play between policy making and
policy implementation and thus the substantive impact that
welfare reform has on users and citizens.
The Moral Economy Approach
Whereas the political economy approach is fueled by a profound skepticism about the ability of society to meet the collective social needs of citizens, the moral economy approach
embraces community as the primary guardian of social well
being. Grounded in a conception of welfare provision as the
natural extension of voluntary, mutualistic forms of self-help,
the moral economy approach offers an alternative framework
for conceptualizing and analyzing social welfare systems as a
product of the so-called welfare society, a model for organizing
social welfare on the basis of interlocking individual sanctions
and rewards emanating from local communities.
The moral economy approach can be further separated
into a progressive and a conservative version based on distinctive interpretations of the social fabric of society. The conservative version of the welfare society is profoundly skeptical
of the governments' ability to gauge social needs and harness
capitalism to fulfill these needs. Emerging as a reaction to the
state's perceived colonization of civil society, this version of
the moral economy perspective underscores the dangers of
publicly provided, state-regulated welfare. Conceptualized
as a paternalistic bureaucracy, the state is seen as creating
harmful 'welfare dependencies,' which erode personal responsibility and weaken the ability of people to help themselves by undermining community-based social and ethnical
norms (Murray, 1989; Mead, 1991). By contrast, the welfare
society, which is viewed as complementing, rather than competing with market-based exchange mechanisms, is seen as
194
Journal of Sociology & Social Welfare
strengthening the social fabric of society by reinforcing traditional values such as family loyalty and social obligation.
A more progressive version of the moral economy approach embraces the welfare society not as the locus of cultural
preservation, but rather as part of a broader movement toward
social solidarity and associative democracy. Emphasizing participation and connectedness to local community as a principle legitimating factor in empowering and assisting people in
need, this perspective sees reciprocity as a necessary precursor
to developing healthy and productive societies. Less a reaction to the state than a response to the commercialization and
alienation that has accompanied the process of modernization,
this version of the moral economy approach sees communities
as critical to actively reconstituting society by reconstructing
identities and extending affective bonds between groups of
people that increasingly lack a shared moral culture (Ezioni,
1991; Donati, 1993; Walzer, 1995; Cohen and Rogers, 1995).
From this perspective, the welfare society embodies a realm of
fluid, multi-faceted relationships which counteract individualism and narrow self interest by fostering trust, mutual respect,
and collective participation.
Regardless of their distinctive understandings of the
social fabric of the welfare society, both versions of the moral
economy approach underscore the importance of social actors,
emotive ideas, and the non-rationality of culture in the development of social welfare systems. Challenging the authority of
the state as legitimate arbitrator of welfare reform, they expand
the scope of inquiry beyond the political economy approach's
relatively narrow focus on poverty rates, social security, and
income-transfers to encompass a broader array of social arrangements and processes, from more traditional conceptions
of self-help to community care (Chambliss, 1996; White, 2000)
and the creation of alternative consciousness (Havel, 1990;
Cruikshank, 1999).
Despite this noteworthy advantage, the moral economy
approach suffers from several shortcomings. First, by ignoring, by and large, the distributional aspects of social welfare
systems, it obscures the important role that societal stratification and inequality play in welfare reform. Because the most
marginalized segments of the population usually lack the
195
capacity to voice their concerns and press their needs effectively, they tend to be disadvantaged by a welfare society which
relies predominately if not exclusively on self identification
of need and voluntary responses to those needs. Second, the
moral economy approach reproduces the state-society dualism
of the political economy approach, thus obscuring rather than
clarifying the relationship between the two realms. By viewing
he welfare society as an autonomous locus of proactive community engagement, responsive to both individual want
and collective need, the moral economy approach portrays
the state as outside of, and thus largely irrelevant to, society.
Where the state is considered, however, the focus of the moral
economy approach is almost exclusively on its coercive power.
As a result, it tends to underestimate the state's role in establishing the foundation for effective responses to a variety of
welfare dilemmas, including stimulating the welfare enhancing properties of community activism by, for example, outlawing discriminatory practices, redistributing scarce resources,
and guaranteeing social rights. A third problem with the moral
economy approach is that it does not pay adequate attention to
the multiplicity of institutional configurations involved in the
day-to-day operation of social welfare systems. Consequently,
it fails to appreciate the extent to which the distinctive juridical and legal status of private and non-profit organizations is
critical to the success of welfare reform.
Social Welfare Systems in the Post-IndustrialEra
The Mixed Economy Approach
The growing complexity of the inter-organizational linkages connecting social organizations to one another and to
public institutions, and the recognition of this development as
critical to determining the consequences of welfare reform, has
led to the development of a third approach, frequently defined
as the mixed economy of welfare. While those who employ
this approach come from a wide array of disciplines, principally economics, but also social welfare, public administration,
and non-profit management, they ground their analysis in a
concept of the welfare mix which is distinctive from both that
of the welfare society the welfare state (Kramer, 1981; TaylorGooby, 1987; Powell, 1987; James, 1989; Abrahamson, P., 1988;
Anheier and Seibel, 1990; Gidron, Kramer, Salamon, 1992;
196
Journal of Sociology & Social Welfare
Salamon & Anheier, 1996).
The concept of the welfare mix emphasizes institutional
plurality and shared responsibility for welfare. Inevitably,
social welfare systems draw on a variety of organizational resources, all of which are embedded within a broader set of exchange and production relationships. As the guarantor of citizen's legal entitlements and a key source of power, the state,
understood more broadly as the public sector, is recognized
as playing a vital role in the creation of social markets, understood as quasi-markets for social goods and services which
separate purchasers, usually government agencies, from providers. The public sector is balanced, however, by two equally
important sectors, the private and non-profit sectors, each of
which operates according to a unique set of norms and principles. Thus, within the mixed economy approach, it is the relationship between the public, private and non-profit sectors
that determines temporal and spatial variation in the output of
social welfare systems.
Emphasizing institutional plurality, the mixed economy
approach to welfare offers an analytic framework in which
the output of welfare systems varies both temporally and spatially according to the relationship between the public, private
and non-profit sectors. Thus, in addition to identifying a third
sector, distinct from both the state and society, the mixed
economy approach has contributed to our understanding of
social welfare systems by paving the way for more sophisticated longitudinal and comparative empirical analysis of welfare
systems across a variety of local and national contexts.
While paving the way for a more sophisticated comparative analysis of welfare systems and their capacity to mediate
pressures for reform, the mixed economy approach has two
significant limitations. First, by assuming a difference in kind
between organizations according to the presence or absence
of certain sector-based properties and functions, the welfare
mix approach falls into the same dilemma of the previous two
approaches. It fails to fully appreciate the breadth and depth
of organizational variation within each sector, thus divorcing
pertinent issues relating to social production (i.e. contracting,
management, participation) from core issues of policy reform
(i.e. cost effectiveness, marginalization, entitlement issues).
Social Welfare Systems in the Post-IndustrialEra
197
Second, in focusing on the technical and economic aspects of
institutional performance, it obscures the social and political
relevance of reform. By failing to link institutional outputs to
the types of system-wide properties that give them meaning
for those that they affect most directly, such as marginalized
citizens and welfare users, the mixed economy approach does
little to improve our understanding of the issues related to
social justice.
An Emerging Paradigm: The Social Economy
2
Approach to Welfare Reform
More recently, a growing body of work emerging from the
social economy literature (6 and Vidal, 1994; Travaglini, 1997;
Defourny et al, 1999; Borzaga, 2000; Van Til, 2000; Pestoff, 1998;
Ranci, 1999; Defourney, Favreeau, Laville, 1999; Borzaga and
Defourny, 2001; Evers et al, 2004; Evers, 1995; De Leonardis,
1998; Laville, J., & Gardin, 1999; Evers and Laville, 2004;
Gonzales, 2006) has established the basis for a new approach
to welfare reform. Motivated by a shared set of theoretical and
empirical concerns about the role of the third sector in mediating the relationship between state, society, and economy,
this social economy approach is distinct from conventional
approaches in that it offers an alternative conceptual understanding of social welfare systems as dynamic, open systems,
grounded in complex institutional networks. In addition, it
seeks to accumulate knowledge about collective forms of entrepreneurship and the extent to which they act as catalysts of
change within emerging welfare networks.
Like political economy and moral economy approaches,
the social economy approach is concerned about macro-level
developments in the economy and society. Yet, it links these
changes to questions and concerns relating to the social and
administrative underpinnings of social welfare. As such,
it introduces greater dynamism by exploring the micro
foundations of institutional change, thus avoiding the political
and moral economy approaches' over-emphasis on the degree
to which macro-level structural and cultural forces favor continuity over change within social welfare systems. Although
recognizing that third sector organizations may rarely
198
Journal of Sociology & Social Welfare
determine social and economic outcomes on their own, the
social economy approach underscores their critical role in establishing the context and meaning that determine how every
day people perceive of and experience social welfare.
While overlapping with the mixed economy approach in
its attention to the third sector, the social economy approach
encompasses a broader understanding of the third sector as
a highly differentiated and interpenetrated institutional realm
neither derivative of, nor inherently in competition with, the
public and private sectors. In proposing a more fluid conceptualization of the third sector as an important nexus of interaction between different principles (i.e. exchange, redistribution,
and reciprocity) otherwise seen as distinctive characteristics of
either economy, state, or community, the social economy approach moves beyond conventional understandings of market
values and interests and social values and interests as inherently conflicting. Embedded in both society and the economy,
third sector organizations create, reconstruct and maintain
social relationships as well as the universe of practices and
forms of mobilizing economic resources, which, as Saucier and
Thivierge (2003) observe, are key to combating poverty, generating social solidarity, and satisfying human needs (as cited in
Van Kemenade, Paradis, and Jenkins, 2003).
The Rise of Welfare Networks
The social economy approach takes for granted that the
processes of globalization and modernization have fundamentally altered the parameters of contemporary welfare systems,
and thus its principle concern is in understanding the capacity
of third sector organizations to serve as a socially efficacious
response to these twin challenges.
Although identifying and explaining the causes of broader
structural change is not a central component of the social
economy approach, its analysis of the third sector's role in
responding to change is informed by an understanding of
globalization and modernization as symptomatic of a fundamental shift in the productive infrastructure of society from
one which was industrial to one which is predominately informational and service based (Priori and Sabel, 1984; Jessop,
1994; Bakker and Miller, 1996; Castells, 1996). By impacting
Social Welfare Systems in the Post-IndustrialEra
199
employment opportunities and family dynamics, this structural shift in the economy significantly impacts the demographic
composition of society, which in turn fuels greater pressures
toward administrative, political and economic decentralization. While these processes significantly increase the complexity of welfare systems (Banting, 1995; Bennett, 1990; Kuhnle and
Selle, 1992; Alber, 1995; Sipila 1997), the capacity of national
public administrators to manage social welfare systems diminishes as greater policy responsibility is transferred to the subnational level, shifting the locus of public intervention away
from the central government to lower levels of government.
In tandem with a pervasive post-materialist shift in values
(Abramson and Inglehardt, 1987; Inglehardt, 1990) post-industrialism entails a transition away from both the state and
society as dominant organizing infrastructures of the social
welfare systems toward more amorphous welfare networks.
This reconstitution of welfare systems into welfare networks
motivates three key developments: 1) The potential for constructing more efficacious responses to new and old social
and economic risks, and 2) The emergence of a more complex
and differentiated third sector, and 3) A more fluid process of
reform facilitated by the proliferation of new organizational
forms and strategies utilized in social welfare provision.
Social Risk and Emerging Welfare Networks
The key characteristics defining the new post-industrial
era-the blurring of boundaries between sectors, the increasing
specialization and volatility of social and economic relations,
and the institutionalization of continual change-both exacerbate pre-existing risks and create new ones. They restrict the
relevant degree of freedom afforded to governments to adopt
and implement social policies that can harness the benefits
and compensate for the losses incurred by globalization and
modernization, thus contributing to what Beck (1998) identifies as the 'democratization of vulnerability' as risk becomes
more fluid. Greater instability and increasing differentiation in
citizens' needs and preferences make it increasingly difficult
for public officials to guarantee a fair and equitable allocation
of social and economic resources and a high standard of living
to all citizens while the combination of diminishing public
200
Journal of Sociology & Social Welfare
resources, increasing ethnic and cultural diversity (and with
it the proliferation of social customs, norms, and practices) increase the threat of various forms of discrimination.
In tandem with these developments, welfare networks
offer the potential for constructing more efficacious responses
to risk, particularly those related to social exclusion and economic dependency. In much the same way that the creation of
the market economy during the nineteenth century gave rise
to what economic historian Karl Polanyi (1944) describes as
a double movement, the social and economic processes set in
motion by the current post-industrial shift has engendered a
countermovement. 3 This countermovement, stimulated by the
impulse to re-embed the economy in social relations, creates
a new role for third sector organizations as the source of alternative social constructions capable of generating a collective response to social need. Although not intrinsically a promoter of social justice, in a context in which globalization,
combined with a maturation of government commitments
increases citizens' vulnerability to social dislocation while simultaneously undermining the capacity and legitimacy of the
state to provide social protection, the third sector represents a
force within local communities that works to make them more
livable, and in many ways, more socially just. By creating new
forms of connectivity and solidarity, covering new forms of
social need, and mobilizing citizen awareness of and reaction
to factors which undermine the public good, third sector organizations alleviate social marginalization, negotiate greater
fairness in the distribution of material and cultural resources,
and reconstruct welfare networks to empower the least powerful in society.
Social Enterprisesand Emerging Welfare Networks
A key factor in the rise of welfare networks is the increasing willingness on the part of politicians, policy-makers, and
administrators to utilize the resources and skills of a myriad of
organizational forms in their efforts to deal with new and old
social risks associated with globalization and modernization.
This in turn has made internal variation within the third sector
much more critical to understanding the output that social
welfare systems generate (Alber, 1995; Munday and Ely, 1996;
Social Welfare Systems in the Post-IndustrialEra
201
Sipila 1997; Pestoff, 1998; Leat, 1993).
Within this context, the social economy perspective highlights social enterprises as playing a particularly innovative
role within emerging welfare networks (EMES project, 1999;
Borzaga, 2000; Pestoff, 1998; Borzaga and Defouney, 2001;
Defourney, Favreeau, Laville, 1999; Van Til, 2000; Evers and
Laville, 2004). While the specific definition of social enterprises
varies, broadly speaking, they are understood as a new, hybrid
form of third sector organization that incorporate into the production and delivery of socio-economic goods and services a
new social enterprise spirit and greater citizen participation as
co-producers. Although more "professionalized" than voluntary organizations, social enterprises are membership based.
They merge economic entrepreneurship with civic entrepreneurship to foster patterns of trust and mutuality between
groups of citizens that come from different cultural and economic backgrounds. While "doing with others" is critical, they
combine internal solidarity with a dedication to the general interest. Their character as multi-stakeholding organizations and
their express commitment to internal democracy allow them
to pursue a variety of social, political, and economic functions
simultaneously, such as greater citizen participation, more rewarding occupation for employees, and higher quality care
giving (Pestoff, 1998: Borzaga, 2000; Borzaga and Defouney,
2001).
Although still not widely identified as social enterprises
per se, these organizations have become increasingly salient
in the development of welfare networks, particularly in continental Europe, where there is a clear and legitimate distinction
between the market and social economy (Perri 6, 1994; Laville
and Nyssens, 2001), mutual aid societies and corporatist organizations are pervasive, and there is a less resolute commitment to individualism and self-reliance. Rather than being
looked upon as a product of incomplete welfare development,
as has been the prevailing view of the third sector's role within
the welfare system, politicians and policy makers from across
the political spectrum have embraced social enterprises as
catalysts for overcoming a myriad of existing dysfunctions
embedded within traditional welfare arrangements (Borgia,
1983; De Leonardis, et. al., 1994; Marzocchi, 2001). Whereas
202
Journal of Sociology & Social Welfare
conservatives see them as a means of introducing greater flexibility and efficiency to remedy what they perceive as overbloated, inefficient centralized welfare bureaucracy, they are
particularly attractive for progressives as bottom-up, peoplecentered alternatives to the hierarchical, highly impersonal
quality of many state-run welfare agencies.
Linking Social Enterprises to Globalization and Welfare Reform
By embracing the notion that market, society and state function as interpenetrated spheres, the social economy approach
provides a more organic understanding of welfare reform as
a fluid and continually evolving process of change. As a consequence, it is not enough to look at the scope and depth of
social policies or the interests and preferences they represent
in order to determine whether emerging welfare networks
constitute welfare retrenchment or reconstruction. Instead,
reform outcomes are more closely tied to how these policies
are configured, interpreted and reconstituted by the myriad
of institutional actors which cross-cut particular sectors and
policy arenas.
Thus, rather than forcing scholars to locate the engine of
reform within one sector or another, the social economy approach allows for the identification of multiple sources of
change. At the same time, it draws attention to a greater focus
on the dynamics of social production (as opposed to policy
formation) in order to better understand how the pressures
and constraints created by post-industrialism, and thus the
processes of globalization and modernization, are being interpreted, processed and transformed into social realities on the
ground. As globalization and modernization have spurred specific socio-demographic pressures such as aging populations,
declining birthrates and increased migration, demand for
more and better quality health and social care has increased, as
have the proliferation of new models of management emphasizing personalization, flexibility and "client" centeredness. In
turn, this has stimulated third sector organizations to take on
a much more central, yet multifaceted role in the process of
social production.
What makes social enterprises particularly interesting as
a unique sub-sector of the third sector is their intrinsically
Social Welfare Systems in the Post-IndustrialEra
203
hybrid nature. Because they are engaged in the productive
function of supplying services to fulfill a specific demand, they
have an exchange function. Yet rather than choosing to maximize service efficiency, revenues or a return on capital, social
enterprises, "combine the necessary economic goal with other
important social goals that can also be achieved or satisfied at
the same time" (Pestoff, 1998: 13). By incorporating new forms
of user and citizen participation and creating a variety of "relational goods," such as trust and solidarity, they are also reciprocity generating institutions (Evers, 2001). In addition, they
are redistributive because they stem from a cooperative effort
to create and provide public goods and services to beneficiaries that extend beyond their direct members. By blending a
variety of social and economic functions typically seen as mutually exclusive, social enterprises represent a unique means of
balancing individual and collective well being.
By harnessing policy strategies aimed at social investment
(Giddens, 1998; Midgley, 2001) to social enterprises, understood as a unique set of institutions capable of fusing stakeholder democracy (Pestoff, 1994; Borzaga & Mittone, 1997),
social capital, (Sabatini, 2006) and social inclusion (Gonzales,
2006), the social economy approach moves beyond a relatively narrow understanding of social welfare systems as exclusively about preserving and/or extending social protection to
one which incorporates their relevance for social justice, more
broadly conceived. In addition, it bolsters our understanding
of how contemporary reforms impact both the most risk prone
segments of the population as well as those that are less disadvantaged by globalization and modernization.
On the one hand, social enterprises extend democratic participation and social capital to socially excluded segments of
the population, who, despite the prospective benefits of postindustrialism, have stayed trapped in the margins of society.
They also have the capacity to expand service networks well
beyond the poor and dispossessed in a way that strengthens the
public sectors' ability to overcome the inconsistencies and differentiation that have historically prevented the consolidation
of a more organic system of social intervention. Embodying
a unique constellation of managerial efficiency, professionalism, and volunteerism, social enterprises offer the potential for
204
Journal of Sociology & Social Welfare
generating a wide range of specialized and general services
to a variety of populations, thus expanding well beyond the
general pattern of service provision among traditional third
sector organizations. Yet, unlike many public agencies, they
are adept at linking civic priorities to public responsibilities.
In the context of global contracting and "partnered subsidiarity," (Fanelli, 2001), social enterprises provide the raw material for transforming welfare networks into networks of social
responsibility by counteracting the erosion of cooperation and
solidarity set in motion by competitive market mechanisms. In
addition to providing immediate assistance to service beneficiaries, they serve as the building blocks of broader collective
social goods. Relying heavily on human and social capital, as
opposed to material and/or technical resources, social enterprises generate job creation for portions of the population that
are often most in need of flexible employment opportunities,
such as women and youth. They also strengthen the social
fabric of communities by bridging local development objectives with traditional "welfare" concerns for the most disadvantaged members of society.
Conclusion
Combining a greater appreciation for the varied nature
of organizational forms and inter-organizational relationships underpinning welfare reform with a central concern for
the needs and concerns of welfare constituents, the emerging
social economy approach identified in this article provides a
useful alternative conceptual and analytical framework for
understanding the capacity of social welfare systems to cope
with the challenges and opportunities posed by globalization
and modernization. By incorporating dynamic interactions
that take place within the realm of institutional formation and
reconfiguration, it allows for a better appreciation of change
without loosing sight of the structural constraints that are critical in defining the parameters of social welfare systems.
Building on this value added, the future analytic tasks in
developing the social economy approach are three fold. Despite
the widespread appeal of social enterprises, the breadth and
scope of empirical research focused on the hybrid nature of
Social Welfare Systems in the Post-IndustrialEra
205
these organizations is limited. More in depth research into the
extent to which social enterprises are able to balance what are
often viewed as conflicting imperatives, both cross-nationally
and over time is critical to better understanding their contribution to promoting social justice. In addition, more attention
needs to be paid to the precise role that governance plays in
harnessing large-scale structural reform to the micro-dynamics involved in the day-to-day practices of welfare institutions.
Lastly, although the social economy approach offers expectations for service delivery within increasingly complex welfare
networks, more theoretical work is needed to link welfare networks to the broader governance systems in which they are
embedded.
References
Abrahamson, P. (1988). Social dynamics of the contemporary welfare
states and the future of solidarity:Market, state or self-help? Institute
of Urban and Regional Development, UCB.
Abramson, P. & Inglehart, R. (1987). Generational Replacement and
the Future of Post-Materialist Values. Journal of Politics, 49(1),
231-241.
Alber, J. (1995). A framework for the comparative study of social
services. Journal of European Social Policy, 5(2).
Anheier, H. K., & Seibel, W. W. (Eds.). (1990). The third sector:
Comparativestudies of nonprofit organization.New York: Walter de
Gruyter.
Anttonen, A., & Sipila, J. European social care services is it possible to
identify models? Journal of European Social Policy, 6(2), 87-100.
Atkinson, T (1992). Towards a European social safety net? Fiscal
Studies, 13(3), 41.
Bacchiega, A., & Borzaga, C. (2001). Social enterprises as incentive
structures. In C. Borzaga, & J. Defourney (Eds.), The emergence of
social enterprises.London: Routledge.
Banting, K. (1995). The welfare state as statecraft: Territorial politics
and canadian social policy. European social policy: Between
fragmentation and integration. Washington D.C.: Brookings
Institute.
Beck, C. (1998). The reinvention of politics: Rethinking modernity in
the global social order. American Journal of Sociology, 103(6).
Bennett, R. J. (1990). Decentralization local governments, and markets.
towardsa post welfare agenda. Oxford: Robert Clarendon Press.
206
Journal of Sociology & Social Welfare
Borgia, R. (Ed.). (1983). La cooperazione di solidarieta sociale.Instituto
Nazionale per l'educazione cooperativa.
Borzaga, C., & Defourney, J. (2001). The emergence of social enterprise.
London: Routledge.
Borzaga, C., & Lepri, S. (1987). Le nuove forme di cooperazione:
Uesperianza delle cooperative di solidarieta sociale. Rivista della
cooperazione, 30.
Borzaga, C., & Santuari, A. (2000). Social co-oeratives:The Italianway to
social enterprises.Unpublished manuscript.
Breda, J. (1995). La valutazione dei servizi sociali e sanitari come
funzione politica. La valutazionedei servizi socialie sanitari.Padova:
Emanuela Zancan.
Caballer, V., Ruano, E. S., & Vivas, D. (1994). Organizations in the
social economy in health care and social services: An overview.
In 6, P. and Vidal, I. (Ed.), Deliveringwelfare. repositioningnon-profit
and cooperative action in western European welfare states. Barcelona:
CIES.
Castells, M. (1996). The rise of the network society. Malden, Mass.:
Blackwell.
Cohen, J., Rogers, J. (1995). Associations and democracy. London:
Verso.
Cruikshank, B. (1999). The Will to Empower: Democratic Citizens
and Other Subjects. Ithaca: Cornell University Press.
De Leonardis, 0. (1998). In un diverso welfare. Milano: Feltrinelli.
Defourny, J. (1992). The origins, forms and role of a third major
sector. In Defourny, & J. Monzon Campos (Eds.), Econmie sociale.
entre economie capitalisteet economie publique. Bruxelles: De BoeckWesmael.
Defourny, J. (Ed.). (1999). The emergence of social enterprises in Europe.
Brussels: EMES European Network.
Donati, P. (1993). La solidarieta come "bene relazionale". Quadarnidi
Azioni Sociale, (Gennaio/Febraio).
EMES. (1999). Lemergere dell'impresa sociale in europa. una breve
panoramica. Impresa Sociale, 44-45(March/June), 41-74.
Esping-Anderson, G. (1990). The three worlds of welfare capitalism.
Cambridge: Polity Press.
Evers, A. (1995). Part of the welfare mix: The third sector as an
intermediate area between the market economy, state, and
community. Voluntas, 10(4), 159-182.
Evers, A. (1998). The constant challenge of defining public good: How
do third sector organizations contribute to it? Voluntas, 10(4).
Evers, A. (2001). The significance of social capital in the multiple goal
and resource structure of social enterprises. In B. C. &J, Defourney
(Ed.), The emergence of social enterprises.London: Routledge.
Evers, A. (2004). Social services by social enterprises: On the possible
contributions of hybrid organizations and a civil society. In A.
E. a. J.-L. Laville (Ed.), The third sector in europe. Northhampton:
Edward Elgar.
Social Welfare Systems in the Post-IndustrialEra
207
Evers, A., & Wintersberger, H. (Eds.). (1990). Shifts in the welfare mix.
Ezioni, A. (1973). The Third Sector and Domestic Missions. Public
AdministrationReview 33,314-323.
Ezioni, A. (1991). A responsive society: Collected essays on guiding
deliberatesocial change. San Francisco: Jossey-Bass Publishers.
Fanelli, C. (2001). Integrazione socio sanitaria e cooperazione sociale.
qualita e regole del rapporto tra pubblico e privato. Unpublished
manuscript.
Fargion, V. (1998). Local Government and the Provision of Personal
Social Services in Europe. European Forum 1998-99 Project:
Recasting the European Welfare State: Options, Constraints, Actors
EUI, Fiesole.
Ferrera, M. (1996). The "southern model" of welfare in social europe.
Journalof European Social Policy, 6(1), 17-37.
Galliano, R. (2003). Social economy entrepreneurship and local
development. Retrieved October 1, 2006 from http://www.
coopscanada.ca/pdf/issues/ social-economy-definition/pdf.
George, V. & P. Taylor Gooby. (1996). European Welfare Policy: Squaring
the Welfare Circle. New York: Saint Martin's Press.
Giddens, A. (1998). The third way. Malden, MA: Polity Press.
Gidron, B., Bar, M., & Katz, H. (Eds.). (2004). The Israeli third sector:
Between welfarestateand civil society. New York: Kluwer Academic /
Plenum Publishers.
Gidron, B., Kramer, R. M., & Salamon, L. M. (Eds.). (1992). Government
and the third sector: Emerging relationships in the welfare state. San
Francisco: Jossey-Bass.
Gilbert, N. (2002). Transformationof the welfare state: The silent surrender
of public responsibility. Oxford: Oxford University Press.
Girard, J., & Langlois, G. (2006). Tracking the social impact of
solidarity co-ops. Makingwaves, 16(1), 5-6.
Glazer, N. (1988). The limits of social policy. Cambridge: Harvard
University Press.
Gonzales, V. (2006). The Social Economy of Welfare Reform: Institutional
Innovation within the ItalianThird Sector. Dissertation. Department
of Political Science: University of California, Berkeley.
Gonzales, V. (Forthcoming). What role do social enterprises play in
empowering users? An analysis of social efficacy among social
cooperatives in Northern Italiy in The social economy as a tool of
social innovation and local development. Trento, Italy:OECD.
Graefe, P. (2005). Roll-out neoliberalismand the social economy. Retrieved
October 20, 2006 from http://www.cpsa-cpsa-acsp.ca/papers2005/Graefe.pdf.
Gronbjerg, K. (1998). Markets, politics and charity: Nonprofits in the
political economy. In Walter Powell, Elisabeth Clemens (Ed.). New
Haven: Yale Press.
Habermas, J. (1989). Structural transformation of the public sphere.
Cambridge: MIT Press.
208
Journal of Sociology & Social Welfare
Hacker, J. (2002). The Divided Welfare State: the Battle over Public and
Private Social Benefits in the United States. New York: Cambridge
University Press.
HandlerJ. (2003). Social Citizenshipand Workfare in the United States and
Western Europe. The Paradoxof Inclusion. Cambridge: Cambridge
University Press.
Hansmann, H. (1987). Economic theories of nonprofit organizations.
In W. Powell (Ed.), The nonprofit sector: A research handbook (). New
Haven: Yale University Press.
Hemerijck, A & J, Visser. (2001). Dutch Lessons in Social Pragmatism.
In Stuart White (Ed.), New Labour: The Progressive Future? New
York: Palgrave.
Huber, E. & Stevens, J. (1997). Welfare state and production regime.
The new politics of the welfare state. Cambridge, MA: Harvard
Center for European Studies.
Inglehart, R. (1990). Culture Shift in Advanced Industrial Society.
Princeton: Princeton University Press.
James, E. (1989). Introduction. In E. James (Ed.), The nonprofit sector
in internationalperspective: Studies in comparativeculture and policy.
Oxford: Oxford University Press.
James, E. (1987). The nonprofit sector in comparative perspective. In
W. Powell (Ed.), The nonprofit sector: A research handbook 0. New
Haven: Yale University Press.
Jessop, B. (1993). Towards a schumpeterian workfare state?
preliminary remarks on post-fordist political economy. Studies in
Political Economy, 40.
Kjellberg, F (1995). The changing values of local government. The
Annals: Local Governance around the World, July, 540.
Kramer, R. (1985). The welfare state and the voluntary sector: The
case of personal social services. In E. Anheier (Ed.), The welfare
state and its aftermath 0. London: Croon Helm.
Kramer, R. (1987). Volontariatoe stato sociale. Roma: Edizioni Lavoro.
Kuhnle, S., &Selle, P. (1992). Government and voluntary organizations,
Arelational perspective. In S. Kuhnle, & P. Selle (Eds.), Government
and voluntary organizatioins.Avebury: Aldershot.
Laville, J. (2001). The social enterprise: Towards a theoretical socioeconomic approach. In J. Defourny (Ed.), The emergence of social
enterprise.London: Routledge.
Laville, J., & Gardin, L. (1999). Le iniziative locali in europa. Torino:
Bollati Boringhieri.
Leat, D. (1993). The development of community care by the independent
sector. London: Policy Studies Institute.
Lepri, S. (1991). Il terzo sistema: Una dimensione della complessita
economica e sociale. In C. Borzaga (Ed.), Il terzo sistema: Una
nuova dimensione della complessita economica e sociale. Padova:
Fondazione E Zancan.
Levy, J. (1999). Vice into virtue? progressive politics and welfare
reform in continental europe. Politics and Society, 27(2), 239-273.
Social Welfare Systems in the Post-IndustrialEra
209
Marzocchi, G. (1997). Cos'e l'impresa sociale. Uinsolito matrimonio e
le virtu deboli. Impresa sociale, (32), 31-35.
Mazzoli, G. (2000). I tre mercati del welfare reggiano. In G. Mazzoli
(Ed.), Il riposizionamentostrategico degli attore del terzo settore nella
ridefinizione del welfare locale (Reggio Capitale Sociale, Vol. 1 ed.,).
Reggio Emilia: Fondazione Pietro Mondodori.
Mead, L. The New Politics of the New Poverty. The Public Interest,
103 (Spring).
Midgley, J. (2001). Growth, Redistribution, and Welfare: Toward Social
Investment. In A. Giddens (Ed.) The Global Third Way Debate.
Mingione, E. (1991). Fragmented societies: A sociology of economic life
beyond the market paradigm.Oxford: Basil Blackwell.
Mingione, E., & Benassi, D. (1998). Poverta, exclusione sociale e
riforma del welfare in italia. Prospettive Sociali e Sanitarie,17.
Mittone, L. (1998). Quasi-mercati, imprese non-profit e razionalita
limitata. In C. Borzaga, G. Fiorentini & A. Matacena (Eds.), Nonprofit e sistemi di welfare. Roma: Carocci.
Murray, C. (1982). The Two Wars Against Poverty. The Public Interest,
69 (Winter).
O'Connell, B. (1996). A major transfer of government responsibility
to voluntary organizations? proceed with caution. Public
AdministrationReview, (May/June).
OECD. (1996). Reconcilingeconomy andsociety. towardsa pluraleconomy.
Paris: OECD.
Pasquinelli, S. (1993). Stato sociale e terzo settore in italia. Stato e
mercato, 38
Pestoff, V A. (1998). Beyond the market and state: Social enterprises and
civil democracy in a welfare state.Aldershot: Ashgate.
Pierson, P. (1997). Post-industrial pressures on the mature welfare
states. the new politics of the welfare state. Cambridge: Cambridge
University Press.
Pierson, P. (1994). Dismantlingthe welfare state? reagan, thatcher,and the
politics of retrenchment. Cambridge: Cambridge University Press.
Piore, M. and Sabel, C. (1984). The Second IndustrialDivide. New York:
Basic Books, New York.
Polanyi, K. (1944). The great transformation.Boston: Beacon Press.
Powell, W. (Ed.). (1987). The nonprofit sector: A research handbook. New
Haven: Yale University Press.
Powell, W & E. Clemens (Eds.), (1998). Private action and the public
good. New Haven: Yale University Press.
Prina, E (1999). Volontariato e impresa sociale di fronte a disagio
sociale, marginalita, devianza. In U. Ascoli. (Ed.), Il welfarefuturo:
Manuale critico del terzo settore. Roma: Carocci.
Ranci, C., & Ascoli, U. (Eds.). (1997). La solidarieta organizzata.FiVol:
Roma.
Ranci, C. (1999). Oltre il welfare state. terzo settore, nuove solidarieta e
transformazionidel welfare. Bologna: 1 Mulino.
210
Journal of Sociology & Social Welfare
Rhodes, M. (1996). Southern european welfare states: Identity,
problems and prospects for reform. South European Society and
Politics,1(3), 1-22.
Salamon, L. S. (1987). Partners in public service: The scope and theory
of government-nonprofit relations. In W. W. Powell (Ed.), The
nonprofit sector: A research handbook. New Haven: Yale University
Press.
Salamon, L., & Anheier, H. (Eds.). (1996). The emerging non-profit
sector. New York: St. Martins Press.
Salamon, L. S., & Anheier, H. K. (1998). Social origins of civil society:
Explaning the non-profit sector cross nationally. Voluntas, 9(3),
213-248.
Salamon, L. M. (Ed.) (2002). The Tools of Government: A Guide to the
New Governance. New York: Oxford University Press.
Sabatini, F. (2006). Social Enterprises, Social Capital and the Quality
of Economy Development: The Case of Italy. Working paper.
Reviewing OECD experience in social enterprise sector: policy
insights for countries of Central East and Southeast Europe.
OECD LEED Trento Centre for Local Development. (November
15-19). Trento, Italy.
Santuari, B. (Ed.). (1998). Social enterprises and new employment in
Europe.Autonomous Region of Trentino: South Tyrol.
Sipila, J. (Ed.). (1997). Social care services: The key to the Scandanavian
welfare mode. Aldershot: Avebury.
Sipila, J. and A. Anttonen. Social services. principles, systems,
outcomes. European Forum: Recasting the European Welfare State:
Options, Constraints, Actors, Florence: European University
Institute (WS/12).
Skocpol, T. (1995). State formation and social policy in the United
States. Social policy in the United States. Princeton, NJ: Princeton
University Press.
Smeriglio, M. (2001). Impresa sociale ed empowerment territoriale.
Rassegnadi Servizio Sociale, Studi, 3-32.
Smith, S.R. and M. Lipsky. (1993). Nonprofitsfor hire. the welfare state in
the age of contracting.Cambridge: Harvard University Press.
Spear, R., Defourny, J., Favreau, L., & Laville, J. (Eds.). (2001). Tackling
social exclusion in Europe: The contribution of the social economy.
Aldershot, Hampshire: Ashgate.
Swank, D. (2002). Global Capital,PoliticalInstitutionsandPolicy Change
in Developed Welfare States. Cambridge: Cambridge Unversity
Press.
Szucs, S. (1995). Democratization and the reorganization of the
welfare state. The Annals of the American Academy of Politicaland
Social Science, 540, July.
Taylor, M., & Hoggett, P. (1994). Trusting in networks? The third
sector and welfare change. In Six P., Vidal I. (Eds.), Delivering
welfare. repositioning non-profit and cooperative action in western
European welfare states. Barcelona: CIES.
Social Welfare Systems in the Post-IndustrialEra
211
Taylor-Gooby, P. (Ed.). (1987). The private provisioin of social welfare:
State market and community. New York: St. Martin's Press.
Travaglini, C. (1997). Le cooperative sociali tra impresa e solidarieta.
Bologna: CLUEB.
Van Kernenade, S., Paradis, S. & Jenkins, E. (2003). Can pubic policy
address social capital? Horizons, 6(3), 31-34.
Van Tl, J. (2000). Growing civil society: From nonprofit sector to third
space. Bloomington: Indiana University Press.
Weir, M., Orloff, A., & Skocpol, T. (1988). Introduction: Understanding
American social policies. In M. Weir, A. Orloff & T. Skocpol
(Eds.), The poilitics of social policy in the United States. Princeton:
Princeton University Press.
White, S. (1998). The third way. interpreting the "third way." not one
road but many. Renewal, 6(2).
6, P. (1994). Public policy, social policy and the third sector. Delivering
welfare. repositioning non-profit and co-operative action in western
European welfare states. Barcelona: CIES.
6, P. and Vidal, I. (Eds.). (1994). Delivering welfare. repositioning nonprofit and cooperative action in western European welfare states.
Barcelona: CIES.
(Endnotes)
1Although it is often used interchangeably with the terms voluntary sector,
independent sector and non-profit sector, here I use third sector to refer
to the sum total of not-for-profit enterprises, cooperatives, and voluntary
associations operating within the intermediary realm between the private
business sector, the public sector, and the personal sector comprised of
family and friends.
2
While the concept of the social economy has been articulated in a variety
of ways, Renato Galliano (2003) best captures the meaning used here
by identifying the term social economy as an expression used to define
a complex world and a system of relationships which governs the life
of the Third System and non-profit enterprises: the creation of flexible
employment, active citizenship, services to people, decentered welfare,
safeguarding of human rights, strong local development policies and social
cooperation.
3In the Great Transformation,Polanyi describes how the ravages of the
enclosure movement, Industrialization and laissez-faire economics created
a spontaneous, deep seated resistance, without which, he argues, modem,
industrial society would not have been possible. For Polanyi, society's
impulse to protect itself against the pernicious effects of the market
economy was, "the one comprehensive feature in the history of the age,"
(p. 76). And thus, "... human society would have been annihilated but for
protective countermoves which blunted the action of this self-destructive
mechanism" (p. 76).
212
Journal of Sociology & Social Welfare